Construction

From 1 September 2019, developers will no longer be able to obtain interim occupation certificates for buildings in NSW. This will likely complicate staged developments, as interim occupation certificates allow use of partially completed buildings.

Following a significant fire in a 23 storey apartment building in Melbourne’s Docklands area on 25 November 2014 (the Lacross Apartments Fire), the rapid spread of which was attributable to a composite aluminium cladding on the building’s façade[1], the Victorian Building Authority has now completed an audit of some 170 high rise buildings in central Melbourne and surrounds with a finding that 51% of the audited buildings contained non-compliant cladding[2].

The Home Building Act 1989 operates in many unexpected ways, for instance a lot of its focus is on managing insurance risk of Builders as opposed to managing quality of construction.

A glaring example of this is that if a licenced contractor is unable to obtain the home warranty insurance from the Home Building Compensation Fund it can perform residential building works of less than $20,000 or construct new residential buildings of four or more storeys of any value (even tens of millions of dollars).

Construction entails many risks to a builder by virtue of its occupation, control and/or ownership of the site. The risks include personal injury or death to persons and damage or destruction of property (including the contract works itself).

As a result of changes to the Home Building Act 1989 (NSW) (“the Act”) residential building work contracts entered into from 1 March 2015 must be compliant with new requirements introduced from that date.

Builders that perform residential building work need to ensure that appropriate systems are in place to ensure that their advertisements comply with legislative requirements for licensing and consumer protection. Outlined below are some issues that should be considered by builders when advertising for residential building work.